Joint buy to let mortgage partner has bad credit history

(34 Posts)
IanD Sat 29-Sep-12 18:11:40

Hi me and my partner are considering buying a property to let out, our problem is that my partner has a bad credit history and we'll not get a mortgage going on her credit score not for the next 6 years at least, we have the funds for the deposit on a property worth around 70k, is there any way round this? Could I get the property in my name and then get a legally binding document to say she paid half?

Any thoughts?

Thanks...

irishbird Sat 06-Oct-12 15:48:14

It's been a bloody bit of a while since I last did land law, but from memory if the express declaration has been entered into before the mortgage (and therefore registered) the mortgage company would either not touch it with a barge pole or require the other parties to the trust to agree to the mortgage and therefore be bound by any actions that were taken on any default. If the trust is set up after the mortgage, then the mortgage takes priority in any event.

But I may well be a bit wrong....

irishbird Sat 06-Oct-12 15:48:50

Arse. Was meant to be strike through instead of underline.

CakeMeIAmYours Sat 06-Oct-12 16:08:47

Right, I understand, you have an equitable interest in the property, but you are not the legal owner.

Does this not make you uncomfortable? Why don't you remortgage in your sole name? You could be doing fabulous things to your credit rating by paying the mortgage, at the moment you're just enhancing your ExDP's credit score.

Surely no-one is the legal owner of their home while they have a mortgage then?

I am a legally interested party in my property however - due to the tenancy-in-common agreement.

I'm not uncomfortable at all as I'm fully protected by the agreement drawn up prior to purchase confused I'll keep on paying my ExP's mortgage for as long as we have a very cheap rate on the current mortgage grin

CakeMeIAmYours Sat 06-Oct-12 17:36:06

I'm not sure what you mean by that?

The mortgagor is the legal owner of the property. The mortgagee is granted (by the mortgagor) a legal charge over the property for for the duration of the mortgage term.

zookeeper Thu 18-Oct-12 16:29:50

Isn't it the other way around? Isn't the bank the mortgageee and the person taking out the mortgage the mortgagor

zookeeper Thu 18-Oct-12 16:31:59

oops sorry Cake; same thing.

matth319 Mon 12-Nov-12 19:35:12

Hi!
I haven't looked at this thread until I last posted....! Unfortunately for CakeMeIAmYours - it looks like what I said originally (5th post) has held out to be true.....
However, despite all that, my only real point to you was - its a sad situation when we can't try and get around problems.....isn't that what being an "adviser" is all about in any profession? Surely, we shouldn't just give up on people because their situation isn't all rosy and perfect. I would have a lot less clients if I just gave them set blanket advice given one certain fact. I always said it was about the knowing the full situation, and then professional advice accordingly...and make a decision based on that advice.
Yes, its easy to make a knee jerk response of "don't enter into a transaction with someone who has adverse credit", and I would agree if it was a purely a new business relationship. But all things considered, there may be a very good reason for the credit problem, and if you live with someone, and let them into your life, you may have been together for 5, 10 or 15 years - you may even have children together; the biggest commitment of them all....Are you seriously warning not to buy a property in one name with a legal agreement in the background without knowing any of this telling information!?
Knowing the situation can give you everything you need to advise accordingly, advice that will certainly stand up to scrutiny of any kind.....

daniellao Tue 11-Dec-12 13:08:43

Have you made a decision on what you're going to do about this Ian?

Large Mortgages

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